Escrow & Title
A Maryland title company discovers a judgment lien against the seller from a prior civil case. At settlement, this lien must be:
ATransferred to the buyer
BPaid off or released before or at settlement so the buyer receives clear title✓ Correct
CDisclosed to the buyer but may remain on title
DIgnored if the judgment is more than 5 years old
Explanation
Judgment liens against the seller must be satisfied at or before settlement so the buyer receives clear, marketable title free of the seller's personal liens.
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Key Terms to Know
Lien
A financial claim against a property that serves as security for a debt or obligation, giving the creditor the right to foreclose if unpaid.
Title InsuranceInsurance protecting against financial loss from defects in a property's title that existed before closing but were unknown at the time of purchase.
DeedA written legal instrument used to transfer ownership of real property from one party (grantor) to another (grantee).
EasementA non-possessory right to use another person's land for a specific purpose.
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